Verizon Argues Spectrum Case Despite Low 4G Uptake
Verizon Wireless filed documents with the Federal Communications Commission last week explaining the necessity of its planned AWS spectrum purchases from four cable companies. "Despite the company's significant investment in network efficiencies, skyrocketing demand will overtake its 4G LTE capacity absent additional spectrum resources, which it needs to secure now given that it faces spectrum constraints in its network in some areas as early as 2013 and in many more by 2015," said the company. Verizon is looking to nab 122 AWS spectrum licenses from Comcast, Time Warner Cable, Bright House Networks and Cox Communications, for which it intends to pay $3.9 billion in total. Several organizations have filed lawsuits opposing the acquisition, citing potential anti-trust concerns. Verizon Wireless CTO Fran Shammo, however, presented a different story to investors last week. Shammo said that only 5% of Verizon Wireless's customers have made the switch to LTE 4G devices, and 95% have remained 3G-only customers. Convincing customers to adopt 4G "is very critical for us, and we're playing a very delicate balancing act here that I don't want to spend any more money on my 3G network," said Shammo. Verizon is currently offering twice the LTE 4G data per month to smartphone customers. The FCC is preparing to review Verizon's requested spectrum purchases.
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